In my experience, the lens has excellent S-AF (single autofocus) - but the C-AF (continuous autofocus) is nowhere near as good. So I continually keep it on S-AF. (Btw I think some users of newer Olympusus - the E-M1 mark III or the OM-1 - have had success with C-AF, but it isn't reliable on the older, original E-M1.
I honestly can't remember what focus settings I have used - I think I vary between the maximum possible (whatever that is) and selecting a square group of focus points (which I can't really remember how many, either). I go back and forth between those. But definitely I don't pick spot focusing.
In terms of the so-called Drive settings, for sitting birds I often just shoot one frame at a time - but I randomly switch back and forth between the sequential modes, either the L (Lower) amount of frames-per-second, or the H (higher amount) but usually the L (lower).
I almost always pick the Silent option, for multiple reasons: first because it makes less noise (thus less likelihood of scaring away birds or whatever), and second because my ancient E-M1 occasionally exhibits the dreaded stuck shutter phenomenon in either normal or so-called anti-shock modes - whereas in Silent mode, it always functions perfectly 100% of the time.
If the bird is sitting and not moving - then I will occasionally shoot in Aperture mode (which also allows me to stop down a little from wide-open aperture, for more depth of field - say up to f/8). But more of the time I will pick S or Shutter mode - allowing me to pick a faster shutter speed - both in case the bird is flying or takes wing - and also because (and maybe this is the hardest part) if you're trying to shoot at 300mm i.e. the extreme telephoto end, it's sometimes (often) challenging to hold the camera perfectly still - and a higher shutter speed theoretically helps freeze the action.
I've also read that it occasionally helps to move the camera framing around a bit, forcing the camera to refocus in autofocus mode - which supposedly (according to some expert birders) helps. Don't ask me why, please, I can't remember. But speaking of difficulties, the hardest part for me is actually following and framing flying birds and hoping that some of your pictures will be in (acceptable) focus. The keeper rate varies wildly. Sometimes I've also tried following a distant bird with a wider angle initially, then zooming in but trying to keep the bird sort of in (auto)focus before actually pressing the shutter. Long story short: it ain't easy. And, almost assuredly, the newer (and more more expensive) versions of the E-M1, have better and more capable autofocusing.
But I like my old E-M1 - and it is still my main (and pretty much only) 'weapon of choice', when trying to take pictures of birds or distant wildlife. And the inexpensive 75-300mm Zuiko (I have version II) focuses quite quickly and nicely, in my opinion.
Good luck! (something we all need, I think)